QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934

For the quarterly period ended June 30, 2015

OR

__

TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934

For the transition period from__________________ to _______________

Commission File Number: 33-59560

REVLON CONSUMER PRODUCTS CORPORATION

(Exact name of registrant as specified in its charter)

Delaware

13-3662953

(State or other jurisdiction of incorporation or organization)

(I.R.S. Employer Identification No.)

One New York Plaza, New York, New York

10004

(Address of principal executive offices)

(Zip Code)

Registrant's telephone number, including area code: 212-527-4000

Indicate by check mark whether the registrant (1) has filed all reports required to be filed by Section 13 or 15(d) of the Securities Exchange Act of 1934 during the preceding 12 months (or for such shorter period that the registrant was required to file such reports), and (2) has been subject to such filing requirements for the past 90 days. Yes ¨ No x

Indicate by check mark whether the registrant has submitted electronically and posted on its corporate Web site, if any, every Interactive Data File required to be submitted and posted pursuant to Rule 405 of Regulation S-T (§232.405 of this chapter) during the preceding 12 months (or for such shorter period that the registrant was required to submit and post such files). Yes x No ¨

Indicate by check mark whether the registrant is a large accelerated filer, an accelerated filer, a non-accelerated filer, or a smaller reporting company. See definitions of “large accelerated filer”, “accelerated filer” and “smaller reporting company” in Rule 12b-2 of the Exchange Act. (Check one):

Large accelerated filer ¨

Accelerated filer ¨

Non-accelerated filer x

Smaller reporting company ¨

(Do not check if a smaller reporting company)

Indicate by check mark whether the registrant is a shell company (as defined in Rule 12b-2 of the Act). Yes ¨ No x

The number of shares outstanding of the registrant's common stock was 5,260 as of June 30, 2015, all of which were held by one affiliate, Revlon, Inc.

Common Stock, par value $1.00 per share; 10,000 shares authorized; 5,260 shares issued and outstanding as of June 30, 2015 and December 31, 2014, respectively

—

—

Additional paid-in capital

955.0

952.1

Accumulated deficit

(1,292.4

)

(1,320.5

)

Accumulated other comprehensive loss

(254.3

)

(243.2

)

Total stockholder's deficiency

(537.1

)

(557.0

)

Total liabilities and stockholder's deficiency

$

2,018.9

$

2,031.2

See Accompanying Notes to Unaudited Consolidated Financial Statements

2

REVLON CONSUMER PRODUCTS CORPORATION AND SUBSIDIARIES

UNAUDITED CONSOLIDATED STATEMENTS OF INCOME AND COMPREHENSIVE INCOME

(dollars in millions)

Three Months Ended June 30,

Six Months Ended June 30,

2015

2014

2015

2014

Net sales

$

482.4

$

497.9

$

920.9

$

967.7

Cost of sales

161.3

167.2

303.6

330.7

Gross profit

321.1

330.7

617.3

637.0

Selling, general and administrative expenses

256.9

261.3

503.8

505.3

Acquisition and integration costs

4.7

0.7

5.9

4.5

Restructuring charges and other, net

(3.6

)

3.8

(3.1

)

17.3

Operating income

63.1

64.9

110.7

109.9

Other expenses, net:

Interest expense

20.5

21.0

40.5

43.3

Amortization of debt issuance costs

1.4

1.4

2.8

2.8

Loss on early extinguishment of debt

—

0.1

—

2.0

Foreign currency (gains) losses, net

(7.9

)

7.2

8.0

8.6

Miscellaneous, net

0.2

—

0.2

0.1

Other expenses, net

14.2

29.7

51.5

56.8

Income from continuing operations before income taxes

48.9

35.2

59.2

53.1

Provision for income taxes

21.4

19.3

31.0

27.0

Income from continuing operations, net of taxes

27.5

15.9

28.2

26.1

Income (loss) from discontinued operations, net of taxes

—

3.7

(0.1

)

0.5

Net income

$

27.5

$

19.6

$

28.1

$

26.6

Other comprehensive income (loss):

Currency translation adjustment, net of tax (a)

0.8

(0.4

)

(12.6

)

1.2

Amortization of pension related costs, net of tax (b)(c)

1.8

1.1

3.5

2.3

Revaluation of derivative financial instruments, net of tax (d)

(0.1

)

(1.9

)

(2.0

)

(2.9

)

Other comprehensive income (loss)

2.5

(1.2

)

(11.1

)

0.6

Total comprehensive income

$

30.0

$

18.4

$

17.0

$

27.2

(a)

Net of tax benefit of $0.2 million and $0.1 million for the three months ended June 30, 2015 and 2014, respectively, and $2.8 million and $0.6 million for the six months ended June 30, 2015 and 2014, respectively.

(b)

Net of tax benefit of $0.4 million and nil for the three months ended June 30, 2015 and 2014, respectively, and $0.7 million and nil for the six months ended June 30, 2015 and 2014, respectively.

(c)

This other comprehensive income component is included in the computation of net periodic benefit (income) costs. See Note 11, “Pension and Post-Retirement Benefits,” for additional information regarding net periodic benefit (income) costs.

(d)

Net of tax benefit of nil and $1.2 million for the three months ended June 30, 2015 and 2014, respectively, and $1.2 million and $1.8 million for the six months ended June 30, 2015 and 2014, respectively.

See Accompanying Notes to Unaudited Consolidated Financial Statements

3

REVLON CONSUMER PRODUCTS CORPORATION AND SUBSIDIARIES

UNAUDITED CONSOLIDATED STATEMENT OF STOCKHOLDER'S DEFICIENCY

(dollars in millions)

RCPC Preferred Stock

Additional Paid-In-Capital

Accumulated Deficit

Accumulated Other Comprehensive Loss

Total Stockholder's Deficiency

Balance, January 1, 2015

$

54.6

$

952.1

$

(1,320.5

)

$

(243.2

)

$

(557.0

)

Stock-based compensation amortization

2.8

2.8

Excess tax benefits from stock-based compensation

0.1

0.1

Net income

28.1

28.1

Other comprehensive loss, net (a)

(11.1

)

(11.1

)

Balance, June 30, 2015

$

54.6

$

955.0

$

(1,292.4

)

$

(254.3

)

$

(537.1

)

(a)

See Note 13, “Accumulated Other Comprehensive Loss,” regarding the changes in the accumulated balances for each component of other comprehensive loss during the six months ended June 30, 2015.

Repayment under the Amended and Restated Senior Subordinated Term Loan

—

(58.4

)

Repayments under the Acquisition Term Loan

(15.9

)

(3.5

)

Prepayments under the 2011 Term Loan

(12.1

)

—

Payment of financing costs

—

(1.8

)

Other financing activities

(2.1

)

(1.4

)

Net cash used in financing activities

(23.5

)

(57.7

)

Effect of exchange rate changes on cash and cash equivalents

(5.9

)

(9.2

)

Net decrease in cash and cash equivalents

(76.3

)

(86.4

)

Cash and cash equivalents at beginning of period

275.3

244.1

Cash and cash equivalents at end of period

$

199.0

$

157.7

Supplemental schedule of cash flow information:

Cash paid during the period for:

Interest

$

37.9

$

45.3

Income taxes, net of refunds

10.8

12.6

See Accompanying Notes to Unaudited Consolidated Financial Statements

5

REVLON CONSUMER PRODUCTS CORPORATION AND SUBSIDIARIES

NOTES TO UNAUDITED CONSOLIDATED FINANCIAL STATEMENTS

(except where otherwise noted, all tabular amounts in millions)

Item 1. Financial Statements

1. DESCRIPTION OF BUSINESS AND SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES

Revlon Consumer Products Corporation ("Products Corporation" and together with its subsidiaries, the "Company") is the direct wholly-owned operating subsidiary of Revlon, Inc., which is a direct and indirect majority-owned subsidiary of MacAndrews & Forbes Incorporated (together with certain of its affiliates other than the Company, "MacAndrews & Forbes"), a corporation wholly-owned by Ronald O. Perelman. The Company’s vision is to establish Revlon as the quintessential and most innovative beauty company in the world by offering products that make consumers feel attractive and beautiful. We want to inspire our consumers to express themselves boldly and confidently. The Company operates in three segments, the consumer division (“Consumer”), the professional division (“Professional”) and Other (as described below). The Company manufactures, markets and sells worldwide an extensive array of beauty and personal care products, including cosmetics, hair color, hair care and hair treatments, beauty tools, men's grooming products, anti-perspirant deodorants, fragrances, skincare and other beauty care products. The Company’s principal customers for its products in the Consumer segment include large mass volume retailers and chain drug and food stores (collectively, the “mass retail channel”) in the U.S. and internationally, as well as certain department stores and other specialty stores, such as perfumeries, outside the U.S. The Company's principal customers for its products in the Professional segment include hair and nail salons and distributors in the U.S. and internationally.

Effective in the second quarter of 2015, the Company has a third reporting segment, Other, which includes the operating results of certain brands that our chief operating decision maker reviews on a stand-alone basis. The results included within the Other segment include the operating results and purchase accounting for the Company's April 2015 acquisition of the CBBeauty Group and certain of its related entities (collectively "CBB" and such transaction, the "CBB Acquisition"). The results included within the Other segment are not material to the Company's consolidated results of operations. Refer to Note 2, "Business Combinations," for further details related to the CBB Acquisition.

The accompanying Consolidated Financial Statements are unaudited. In management's opinion, all adjustments necessary for a fair presentation have been made. The Consolidated Financial Statements include the accounts of the Company after the elimination of all material intercompany balances and transactions.

The preparation of financial statements in conformity with U.S. generally accepted accounting principles (“U.S. GAAP”) requires management to make estimates and assumptions that affect amounts of assets and liabilities and disclosures of contingent assets and liabilities as of the date of the financial statements and reported amounts of revenues and expenses during the periods presented. Actual results could differ from these estimates. Estimates and assumptions are reviewed periodically and the effects of revisions are reflected in the consolidated financial statements in the period they are determined to be necessary. Significant estimates made in the accompanying Consolidated Financial Statements include, but are not limited to, allowances for doubtful accounts, inventory valuation reserves, expected sales returns and allowances, trade support costs, certain assumptions related to the valuation of acquired intangible and long-lived assets and the recoverability of intangible and long-lived assets, income taxes, including deferred tax valuation allowances and reserves for estimated tax liabilities, restructuring costs, certain estimates and assumptions used in the calculation of the net periodic benefit (income) costs and the projected benefit obligations for the Company’s pension and other post-retirement plans, including the expected long-term return on pension plan assets and the discount rate used to value the Company’s pension benefit obligations. The Consolidated Financial Statements should be read in conjunction with the consolidated financial statements and related notes contained in the Company's Annual Report on Form 10-K for the year ended December 31, 2014, filed with the U.S. Securities and Exchange Commission (the "SEC") on March 12, 2015 (the "2014 Form 10-K").

The Company's results of operations and financial position for interim periods are not necessarily indicative of those to be expected for a full year.

Certain prior year amounts in the Consolidated Financial Statements have been reclassified to conform to the current period's presentation.

Impact of Foreign Currency Translation - Venezuela Currency

In January 2014, the Venezuela government announced that the CADIVI would be replaced by the government-operated National Center of Foreign Commerce (the "CENCOEX"), and indicated that the Sistema Complementario de Administración de Divisas (“SICAD”) market would continue to be offered as an alternative foreign currency exchange. Additionally, a parallel foreign currency exchange system, SICAD II, started functioning in March 2014 and allowed companies to apply for the purchase of foreign currency and foreign currency denominated securities for any legal use or purpose. Throughout 2014, the Company exchanged Bolivars for U.S. Dollars to the extent permitted through the various foreign currency markets available based on its ability to participate in those markets. Prior to June 30, 2014, the Company utilized the official rate of 6.3 Bolivars per U.S. Dollar (the "Official Rate") and following a consideration of the Company's specific facts and circumstances, which included its legal

6

REVLON CONSUMER PRODUCTS CORPORATION AND SUBSIDIARIES

NOTES TO UNAUDITED CONSOLIDATED FINANCIAL STATEMENTS

(except where otherwise noted, all tabular amounts in millions)

ability and intent to participate in the SICAD II exchange market to import finished goods into Venezuela, the Company determined that it was appropriate to utilize the SICAD II rate of 53 Bolivars per U.S. Dollar (the "SICAD II Rate") to translate Revlon Venezuela’s financial statements beginning on June 30, 2014. As a result, the Company recorded a foreign currency loss of $6.0 million in the second quarter of 2014 related to the required re-measurement of Revlon Venezuela’s monetary assets and liabilities.

In February 2015, the Venezuela government introduced a new foreign currency exchange platform, the Marginal Currency System ("SIMADI"), which created a third new mechanism to trade dollars through private brokers. SIMADI replaced the SICAD II system and started operating on February 12, 2015. As a result, the Company considered its specific facts and circumstances in order to determine the appropriate rate of exchange to translate Revlon Venezuela’s financial statements. As of June 30, 2015, the Company has not participated in the SIMADI exchange market; however, given the elimination of the SICAD II system, the Company determined that it was appropriate to use the SIMADI rate of 193 Bolivars per U.S. Dollar (the "SIMADI Rate") to translate Revlon Venezuela’s balance sheet beginning on March 31, 2015.

As a result of the change from the SICAD II Rate to the SIMADI Rate on March 31, 2015, the Company was required to re-measure all of Revlon Venezuela’s monetary assets and liabilities at the SIMADI Rate of 193 Bolivars per U.S. Dollar. The Company recorded a foreign currency loss of $1.9 million in the first quarter of 2015 as a result of the required re-measurement of Revlon Venezuela’s balance sheet. As Venezuela was designated as a highly inflationary economy effective January 1, 2010, the Company reflected this foreign currency loss in earnings.

Recently Adopted Accounting Pronouncements

In April 2014, the FASB issued ASU No. 2014-08, "Reporting Discontinued Operations and Disclosures of Disposals of Components of an Entity," which changes the requirements for reporting discontinued operations under Accounting Standards Codification Topic 205. Under ASU No. 2014-08, a disposal of a component of an entity or a group of components of an entity is required to be reported in discontinued operations if the disposal represents a strategic shift that has, or will have, a major effect on an entity’s operations and financial results. The standard states that a strategic shift could include a disposal of (i) a major geographical area of operations; (ii) a major line of business; (iii) a major equity method investment; or (iv) other major parts of an entity. ASU No. 2014-08 no longer precludes presentation as a discontinued operation if (i) there are operations and cash flows of the component that have not been eliminated from the reporting entity’s ongoing operations or (ii) there is significant continuing involvement with a component after its disposal. Additional disclosures about discontinued operations will also be required. The guidance is effective for annual periods beginning on or after December 15, 2014, and is to be applied prospectively to new disposals and new classifications of disposal groups as held for sale after the effective date. The Company adopted ASU No. 2014-08 on a prospective basis beginning on January 1, 2015, and such adoption did not have an impact on the Company's results of operations, financial condition or financial statement disclosures.

Recently Issued Accounting Pronouncements

In April 2015, the FASB issued ASU No. 2015-03, "Simplifying the Presentation of Debt Issuance Costs," which amends the presentation of debt issuance costs by requiring debt issuance costs to be presented as a deduction from the corresponding debt liability, consistent with the presentation of debt discounts in the financial statements. The guidance is effective for annual periods beginning after December 15, 2015, with early adoption permitted, and is to be applied retrospectively. The Company expects to adopt ASU No. 2015-03 beginning on January 1, 2016 and the adoption of the new guidance is not expected to have a material impact on the Company’s results of operations, financial condition and financial statement disclosures.

2. BUSINESS COMBINATIONS

The CBBeauty Group Acquisition

On April 21, 2015 (the "Acquisition Date"), the Company completed the CBB Acquisition for a total cash consideration of $49.3 million. CBB is a U.K.-based company whose primary business consists of licensing and distributing fragrances under brands such as One Direction and Burberry. On the Acquisition Date, the Company used cash on hand to pay 70% of the total cash consideration, or $34.6 million. The remaining $14.7 million of the total cash consideration is payable over 4 years in equal annual installments, subject to the selling shareholders' compliance with certain service conditions. These remaining installments will be recorded as a component of SG&A expenses ratably over the 4-year period. CBB is expected to provide the Company with a platform to develop the Company's presence in the fragrance category. The results of operations of the CBB business are included in the Company’s Consolidated Financial Statements commencing on the Acquisition Date. Pro forma results of operations have not been presented, as the impact of the CBB Acquisition on the Company’s consolidated financial results is not material.

7

REVLON CONSUMER PRODUCTS CORPORATION AND SUBSIDIARIES

NOTES TO UNAUDITED CONSOLIDATED FINANCIAL STATEMENTS

(except where otherwise noted, all tabular amounts in millions)

The Company accounted for the CBB Acquisition as a business combination during the second quarter of 2015 and, accordingly, the total consideration of $34.6 million paid on the Acquisition Date has been recorded based on the respective estimated fair values of the net assets acquired on the Acquisition Date, with resulting goodwill, as follows:

Fair Values at April 21, 2015

Total Net Assets Acquired (a)

$

3.9

Purchased Intangible Assets (b)

11.9

Goodwill

18.8

Total consideration

$

34.6

(a) Total net assets acquired in the CBB Acquisition is comprised primarily of trade receivables and accounts payable.

The fair values of the net assets acquired in the CBB Acquisition were based on management’s preliminary estimate of the respective fair values. The estimated fair values of net assets and resulting goodwill are subject to the Company finalizing its analysis of the fair value of CBB’s assets and liabilities as of the Acquisition Date and may be adjusted upon completion of such analysis. In addition, information unknown at the time of the CBB Acquisition could result in adjustments to the respective fair values and resulting goodwill within the year following the CBB Acquisition.

In determining the fair values of net assets acquired and resulting goodwill, the Company considered, among other factors, the analysis of CBB's historical financial performance and an estimate of the future performance of the acquired business, as well as market participants' intended use of the acquired assets. Both the intangible assets acquired and goodwill are not deductible for income tax purposes.

3. RESTRUCTURING CHARGES

Integration Program

Following Products Corporation's October 2013 acquisition of The Colomer Group Participations, S.L. ("Colomer" and the "Colomer Acquisition"), the Company announced in January 2014 that it was implementing actions to integrate Colomer’s operations into the Company’s business, as well as additional restructuring actions identified to reduce costs across the Company’s businesses (all such actions, together, the “Integration Program”).

The Company expects to recognize total restructuring charges, capital expenditures and related non-restructuring costs under the Integration Program of approximately $50 million in the aggregate over the periods described below.

The Integration Program is designed to deliver cost reductions throughout the combined organization by generating synergies and operating efficiencies within the Company’s global supply chain and consolidating offices and back office support, and other actions designed to reduce selling, general and administrative ("SG&A") expenses. Certain actions that are part of the Integration Program are subject to consultations with employees, works councils or unions and governmental authorities. The Company expects to substantially complete the Integration Program by the end of 2015.

The approximately $50 million of total expected non-restructuring costs, capital expenditures and restructuring charges under the Integration Program referred to above consist of the following:

1.

$1.2 million and $18.4 million of non-restructuring integration costs recognized during the six months ended June 30, 2015, and through December 31, 2014, respectively. Such costs have been reflected within acquisition and integration costs in the Company's Consolidated Statements of Income and Comprehensive Income and are related to combining Colomer’s operations into the Company’s business;

2.

Expected integration-related capital expenditures of approximately $6 million, of which $0.7 million and $4.4 million has been paid during the six months ended June 30, 2015 and through December 31, 2014, respectively, with the remaining balance expected to be paid during the remainder of 2015; and

3.

Expected total restructuring and related charges of approximately $22 million, of which $(2.4) million and $20.1 million was recognized during the six months ended June 30, 2015 and through December 31, 2014, respectively, with the remaining charges expected to be recognized during the remainder of 2015. A summary of the restructuring and related charges for the Integration Program incurred through June 30, 2015 and those expected to be incurred during the remainder of 2015 are as follows:

Restructuring Charges and Other, Net

Employee Severance and Other Personnel Benefits

Other

Total Restructuring Charges

Inventory Write-offs and Other Manufacturing-Related Costs (a)

Other Charges (b)

Total Restructuring and Related Charges

Charges incurred through December 31, 2014

$

17.3

$

1.6

$

18.9

$

0.6

$

0.6

$

20.1

Charges incurred in the six months ended June 30, 2015

$

(2.9

)

$

—

$

(2.9

)

$

0.2

$

0.3

$

(2.4

)

Cumulative charges incurred through June 30, 2015

$

14.4

$

1.6

$

16.0

$

0.8

$

0.9

$

17.7

Total expected charges

$

15.0

$

3.0

$

18.0

$

2.5

$

1.5

$

22.0

(a)

Inventory write-offs and other manufacturing-related costs are recorded within cost of sales within the Company’s Consolidated Statements of Income and Comprehensive Income.

(b)

Other charges are recorded within SG&A expenses within the Company’s Consolidated Statements of Income and Comprehensive Income.

During the six months ended June 30, 2015, the Company recorded a benefit of $2.4 million in connection with the Integration Program, of which $3.8 million is related to the Consumer segment, partially offset by charges of $1.4 million related to the Professional segment. During the six months ended June 30, 2014, the Company recorded charges related to the Integration Program of $15.7 million, of which $6.4 million related to the Consumer segment and $9.3 million related to the Professional segment.

The Company expects that cash payments related to the restructuring and related charges in connection with the Integration Program will total approximately $21 million, of which $3.9 million was paid during the six months ended June 30, 2015 and $9.6 million was paid during 2014. The remaining balance of $7.5 million is expected to be paid during the remainder of 2015.

December 2013 Program

In December 2013, the Company announced restructuring actions that included exiting its business operations in China, as well as implementing other immaterial restructuring actions outside the U.S., which are expected to generate other operating efficiencies (the "December 2013 Program"). These restructuring actions resulted in the Company eliminating approximately 1,100 positions in 2014, primarily in China, which included eliminating in the first quarter of 2014 approximately 940 beauty advisors retained indirectly through a third-party agency. The charges incurred for the December 2013 Program relate entirely to the Consumer segment.

A summary of the restructuring and related charges incurred through June 30, 2015 in connection with the December 2013 Program is presented in the following table:

Restructuring Charges and Other, Net

Employee Severance and Other Personnel Benefits

Other

Total Restructuring Charges

Allowances and Returns

Inventory Write-offs

Other Charges

Total Restructuring and Related Charges

Cumulative charges incurred through June 30, 2015

$

8.6

$

0.3

$

8.9

$

6.5

$

3.1

$

0.4

$

18.9

Total expected charges

$

8.6

$

0.3

$

8.9

$

6.5

$

3.1

$

0.4

$

18.9

The Company expects net cash payments related to the December 2013 Program to total approximately $17 million, of which $15.5 million was paid in 2014 and $0.1 million was paid in 2013. No charges were incurred during the six months ended June 30, 2015 related to the December 2013 program. The remaining balance is expected to be paid in 2016.

Restructuring Reserve

The related liability balance and activity for each of the Company's restructuring programs as summarized above are presented as follows:

Utilized, Net

Balance

Beginning of Year

(Income) Expense, Net

Foreign Currency Translation

Cash

Non-cash

Balance End of Year

Integration Program:

Employee severance and other personnel benefits

$

9.6

$

(2.9

)

$

(0.1

)

$

(3.4

)

$

—

$

3.2

Other

0.1

—

—

(0.1

)

—

—

December 2013 Program:

Employee severance and other personnel benefits

1.2

—

—

—

—

1.2

Other

—

—

—

—

—

—

Other immaterial actions: (a)

Employee severance and other personnel benefits

3.1

(0.2

)

—

(1.6

)

—

1.3

Other

—

—

—

—

—

—

Total restructuring reserve

$

14.0

$

(3.1

)

$

(0.1

)

$

(5.1

)

$

—

$

5.7

(a) Other immaterial actions primarily include liabilities for employee-related costs within both the Consumer and Professional reportable segments related to immaterial restructuring actions.

As of June 30, 2015, $5.7 million of the restructuring reserve balance was included within accrued expenses and other in the Company's Consolidated Balance Sheet. At December 31, 2014, $13.7 million of the restructuring reserve balance was included within accrued expenses and other and $0.3 million was included within other long-term liabilities in the Company's Consolidated Balance Sheet.

4. DISCONTINUED OPERATIONS

On December 30, 2013, the Company announced that it was implementing restructuring actions that included exiting its business operations in China (refer to Note 3, "Restructuring Charges - December 2013 Program").

The results of the China discontinued operations are included within loss from discontinued operations, net of taxes, and relate to the Consumer segment. The summary comparative financial results of discontinued operations are as follows:

Three Months Ended June 30,

Six Months Ended June 30,

2015

2014

2015

2014

Net sales

$

—

$

2.2

$

—

$

2.6

Income (loss) from discontinued operations, before taxes

—

3.5

(0.1

)

0.7

Provision for income taxes

—

(0.2

)

—

0.2

Income (loss) from discontinued operations, net of taxes

—

3.7

(0.1

)

0.5

Assets and liabilities of the China discontinued operations included in the Consolidated Balance Sheets consist of the following:

June 30, 2015

December 31, 2014

Cash and cash equivalents

$

2.9

$

2.4

Trade receivables, net

0.2

0.2

Total current assets

3.1

2.6

Total assets

$

3.1

$

2.6

Accounts payable

$

0.7

$

0.2

Accrued expenses and other

3.8

3.9

Total current liabilities

4.5

4.1

Total liabilities

$

4.5

$

4.1

8

REVLON CONSUMER PRODUCTS CORPORATION AND SUBSIDIARIES

NOTES TO UNAUDITED CONSOLIDATED FINANCIAL STATEMENTS

(except where otherwise noted, all tabular amounts in millions)

5. INVENTORIES

June 30, 2015

December 31, 2014

Raw materials and supplies

$

63.3

$

47.2

Work-in-process

11.0

9.0

Finished goods

122.3

100.4

$

196.6

$

156.6

6. GOODWILL AND INTANGIBLE ASSETS, NET

Goodwill

The following table presents the changes in goodwill by segment during the six months ended June 30, 2015:

Consumer

Professional

Other

Total

Balance at December 31, 2014

$

217.9

$

246.2

$

—

$

464.1

Goodwill acquired

—

—

18.8

18.8

Foreign currency translation adjustment

—

(4.6

)

—

(4.6

)

Balance at June 30, 2015

$

217.9

$

241.6

$

18.8

$

478.3

The goodwill acquired during 2015 relates to the CBB Acquisition and was assigned to the Company's Other segment. See Note 1, "Description of the Business and Summary of Significant Accounting Policies," for further discussion of the "Other" segment and Note 2, "Business Combinations," for further discussion of the CBB Acquisition.

9

REVLON CONSUMER PRODUCTS CORPORATION AND SUBSIDIARIES

NOTES TO UNAUDITED CONSOLIDATED FINANCIAL STATEMENTS

(except where otherwise noted, all tabular amounts in millions)

Intangible Assets, Net

The following tables present details of the Company's total intangible assets:

June 30, 2015

Gross Carrying Amount

Accumulated Amortization

Net Carrying Amount

Weighted Average Useful Life (in Years)

Finite-lived intangible assets:

Trademarks and Licenses

$

140.2

$

(29.0

)

$

111.2

14

Customer relationships

118.4

(16.9

)

101.5

16

Patents and Internally-Developed IP

16.3

(3.1

)

13.2

10

Distribution rights

2.8

(0.1

)

2.7

5

Total finite-lived intangible assets

$

277.7

$

(49.1

)

$

228.6

Indefinite-lived intangible assets:

Trade Names

$

96.4

$

—

$

96.4

Total indefinite-lived intangible assets

$

96.4

$

—

$

96.4

Total intangible assets

$

374.1

$

(49.1

)

$

325.0

December 31, 2014

Gross Carrying Amount

Accumulated Amortization

Net Carrying Amount

Weighted Average Useful Life (in Years)

Finite-lived intangible assets:

Trademarks and Licenses

$

140.5

$

(23.5

)

$

117.0

14

Customer relationships

109.1

(13.4

)

95.7

17

Patents and Internally-Developed IP

16.2

(2.4

)

13.8

10

Total finite-lived intangible assets

$

265.8

$

(39.3

)

$

226.5

Indefinite-lived intangible assets:

Trade Names

$

101.3

$

—

$

101.3

Total indefinite-lived intangible assets

$

101.3

$

—

$

101.3

Total intangible assets

$

367.1

$

(39.3

)

$

327.8

7. ACCRUED EXPENSES AND OTHER

June 30, 2015

December 31, 2014

Sales returns and allowances

$

58.6

$

70.6

Compensation and related benefits

53.9

66.8

Advertising and promotional costs

40.6

44.9

Taxes

25.8

23.3

Interest

12.4

11.0

Restructuring reserve

5.7

13.7

Other

49.4

43.0

$

246.4

$

273.3

10

REVLON CONSUMER PRODUCTS CORPORATION AND SUBSIDIARIES

NOTES TO UNAUDITED CONSOLIDATED FINANCIAL STATEMENTS

(except where otherwise noted, all tabular amounts in millions)

8. LONG-TERM DEBT

June 30, 2015

December 31, 2014

Amended Term Loan Facility: Acquisition Term Loan due 2019, net of discounts (a)

$

675.8

$

691.6

Amended Term Loan Facility: 2011 Term Loan due 2017, net of discounts (a)

660.1

671.6

Amended Revolving Credit Facility (b)

—

—

5¾% Senior Notes due 2021 (c)

500.0

500.0

Spanish Government Loan due 2025 (d)

0.6

0.7

1,836.5

1,863.9

Less current portion (*)

(6.9

)

(31.5

)

$

1,829.6

$

1,832.4

(*) At December 31, 2014, the Company classified $31.5 million of long-term debt as a current liability, which was primarily comprised of a $24.6 million required “excess cash flow” prepayment (as defined under the Amended Term Loan Agreement, as hereinafter defined) which was paid on March 12, 2015 and the Company’s regularly scheduled $1.7 million quarterly principal amortization payments (after giving effect to such prepayment) due in 2015.

(a) See Note 11, "Long-Term Debt," to the Consolidated Financial Statements in the Company's 2014 Form 10-K for certain details regarding Products Corporation's amended term loan agreement, which facility is comprised of (i) the $675.0 million term loan due November 19, 2017 (the "2011 Term Loan") and (ii) the $700.0 million term loan due October 8, 2019 (the "Acquisition Term Loan") which had $1,340.0 million in aggregate principal balance outstanding at June 30, 2015 (together, the "Amended Term Loan Agreement").

(c) See Note 11, "Long-Term Debt," to the Consolidated Financial Statements in the Company's 2014 Form 10-K for certain details regarding Products Corporation's 5¾% Senior Notes that mature on February 15, 2021.

(d) See Note 11, "Long-Term Debt," to the Consolidated Financial Statements in the Company's 2014 Form 10-K for certain details regarding the euro-denominated loan payable to the Spanish government that matures on June 30, 2025.

2015 Debt Related Transaction

Amended Term Loan Facility - Excess Cash Flow Payment

On March 12, 2015, in accordance with the terms of the Amended Term Loan Facility, Products Corporation prepaid $24.6 millionof indebtedness, representing 50% of its 2014 “excess cash flow” as defined under the Amended Term Loan Agreement. The prepayment was applied on a ratable basis between the principal amounts outstanding under the 2011 Term Loan and the Acquisition Term Loan. The amount of the prepayment applied to the 2011 Term Loan reduced the principal amount outstanding by $12.1 million to $662.9 million (as all amortization payments under the 2011 Term Loan had been paid). The $12.5 million applied to the Acquisition Term Loan reduced Products Corporation's future regularly scheduled quarterly amortization payments under the Acquisition Term Loan on a ratable basis from $1.8 million prior to the prepayment to $1.7 million after giving effect to the prepayment and through its maturity on October 8, 2019.

Covenants

Products Corporation was in compliance with all applicable covenants under the Amended Term Loan Agreement and the Amended Revolving Credit Facility as of June 30, 2015. At June 30, 2015, the aggregate principal amounts outstanding under the Acquisition Term Loan and the 2011 Term Loan were $677.1 million and $662.9 million, respectively, and availability under the $175.0 million Amended Revolving Credit Facility, based upon the calculated borrowing base less $8.8 million of outstanding undrawn letters of credit and nil then drawn on the Amended Revolving Credit Facility, was $166.2 million.

Products Corporation was in compliance with all applicable covenants under its 5¾% Senior Notes Indenture as of June 30, 2015 and December 31, 2014.

11

REVLON CONSUMER PRODUCTS CORPORATION AND SUBSIDIARIES

NOTES TO UNAUDITED CONSOLIDATED FINANCIAL STATEMENTS

(except where otherwise noted, all tabular amounts in millions)

9. FAIR VALUE MEASUREMENTS

Assets and liabilities are required to be categorized into three levels of fair value based upon the assumptions used to price the assets or liabilities. Level 1 provides the most reliable measure of fair value, whereas Level 3, if applicable, generally would require significant management judgment. The three levels for categorizing the fair value measurement of assets and liabilities are as follows:

•

Level 1: Fair valuing the asset or liability using observable inputs, such as quoted prices in active markets for identical assets or liabilities;

•

Level 2: Fair valuing the asset or liability using inputs other than quoted prices that are observable for the applicable asset or liability, either directly or indirectly, such as quoted prices for similar (as opposed to identical) assets or liabilities in active markets and quoted prices for identical or similar assets or liabilities in markets that are not active; and

•

Level 3: Fair valuing the asset or liability using unobservable inputs that reflect the Company’s own assumptions regarding the applicable asset or liability.

As of June 30, 2015, the fair values of the Company’s financial assets and liabilities that are required to be measured at fair value are categorized in the table below:

Total

Level 1

Level 2

Level 3

Assets:

Derivatives:

FX Contracts(a)

$

0.7

$

—

$

0.7

$

—

Total assets at fair value

$

0.7

$

—

$

0.7

$

—

Liabilities:

Derivatives:

FX Contracts(a)

$

0.2

$

—

$

0.2

$

—

2013 Interest Rate Swap(b)

7.1

—

7.1

—

Total liabilities at fair value

$

7.3

$

—

$

7.3

$

—

As of December 31, 2014, the fair values of the Company’s financial assets and liabilities that are required to be measured at fair value are categorized in the table below:

Total

Level 1

Level 2

Level 3

Assets:

Derivatives:

FX Contracts(a)

$

0.2

$

—

$

0.2

$

—

Total assets at fair value

$

0.2

$

—

$

0.2

$

—

Liabilities:

Derivatives:

2013 Interest Rate Swap(b)

$

3.5

$

—

$

3.5

$

—

Total liabilities at fair value

$

3.5

$

—

$

3.5

$

—

(a)

The fair value of the Company’s foreign currency forward exchange contracts ("FX Contracts") was measured based on observable market transactions for similar transactions in actively quoted markets of spot and forward rates on the respective dates. See Note 10, “Financial Instruments.”

(b)

The fair value of the Company's 2013 Interest Rate Swap was measured based on the implied forward rates from the U.S. Dollar three-month LIBOR yield curve on the respective dates. See Note 10, “Financial Instruments.”

12

REVLON CONSUMER PRODUCTS CORPORATION AND SUBSIDIARIES

NOTES TO UNAUDITED CONSOLIDATED FINANCIAL STATEMENTS

(except where otherwise noted, all tabular amounts in millions)

As of June 30, 2015, the fair values and carrying values of the Company’s long-term debt, including the current portion of long-term debt, are categorized in the table below:

Fair Value

Level 1

Level 2

Level 3

Total

Carrying Value

Liabilities:

Long-term debt, including current portion

$

—

$

1,828.9

$

—

$

1,828.9

$

1,836.5

As of December 31, 2014, the fair values and carrying values of the Company’s long-term debt, including the current portion of long-term debt, are categorized in the table below:

Fair Value

Level 1

Level 2

Level 3

Total

Carrying Value

Liabilities:

Long-term debt, including current portion

$

—

$

1,844.0

$

—

$

1,844.0

$

1,863.9

The fair value of the Company's long-term debt, including the current portion of long-term debt, is based on the quoted market prices for the same issues.

Products Corporation maintains standby and trade letters of credit for various corporate purposes under which Products Corporation is obligated, of which $8.8 million and $9.0 million (including amounts available under credit agreements in effect at that time) were maintained at June 30, 2015 and December 31, 2014, respectively. Included in these amounts are approximately $7.5 million and $7.7 million at June 30, 2015 and December 31, 2014, respectively, in standby letters of credit that support Products Corporation’s self-insurance programs. The estimated liability under such programs is accrued by Products Corporation.

The FX Contracts are entered into primarily to hedge the anticipated net cash flows resulting from inventory purchases and intercompany payments denominated in currencies other than the local currencies of the Company’s foreign and domestic operations and generally have maturities of less than one year.

The U.S. Dollar notional amount of the FX Contracts outstanding at June 30, 2015 and December 31, 2014 was $61.2 million and $7.6 million, respectively.

Interest Rate Swap Transaction

In November 2013, Products Corporation executed a forward-starting floating-to-fixed interest rate swap transaction with a 1.00% floor, based on a notional amount of $400 million in respect of indebtedness under the Acquisition Term Loan over a period of three years (the "2013 Interest Rate Swap"). The Company designated the 2013 Interest Rate Swap as a cash flow hedge of the variability of the forecasted three-month LIBOR interest rate payments related to its Acquisition Term Loan with respect to the $400 million notional amount over the three-year term of the 2013 Interest Rate Swap. Under the terms of the 2013 Interest Rate Swap, Products Corporation will receive from the counterparty a floating interest rate based on the higher of three-month USD LIBOR or 1.00%, which commenced in May 2015, while paying a fixed interest rate payment to the counterparty equal to 2.0709% (which effectively fixes the interest rate on such notional amount at 5.0709% over the three-year term of the 2013 Interest Rate Swap). For the six months ended June 30, 2015, the 2013 Interest Rate Swap was deemed effective and therefore the changes in fair value related to the 2013 Interest Rate Swap have been recorded in Other Comprehensive Loss. As of June 30, 2015, the

13

REVLON CONSUMER PRODUCTS CORPORATION AND SUBSIDIARIES

NOTES TO UNAUDITED CONSOLIDATED FINANCIAL STATEMENTS

(except where otherwise noted, all tabular amounts in millions)

balance of deferred net losses on derivatives included in accumulated other comprehensive loss was $4.2 million after-tax. (See "Quantitative Information – Derivative Financial Instruments" below). The Company expects that $2.3 million of the after-tax deferred net losses related to the 2013 Interest Rate Swap will be reclassified into earnings over the next 12 months as a result of transactions that are expected to occur over that period. The amount ultimately realized in earnings may differ as LIBOR is subject to change. Realized gains and losses are ultimately determined by actual rates at maturity of the derivative.

Credit Risk

Exposure to credit risk in the event of nonperformance by any of the counterparties is limited to the gross fair value of the derivative instruments in asset positions, which totaled $0.7 million and $0.2 million as of June 30, 2015 and December 31, 2014, respectively. The Company attempts to minimize exposure to credit risk by generally entering into derivative contracts with counterparties that have investment-grade credit ratings and are major financial institutions. The Company also periodically monitors any changes in the credit ratings of its counterparties. Given the current credit standing of the Company's counterparties to its derivative instruments, the Company believes the risk of loss under these derivative instruments arising from any non-performance by any of the counterparties is remote.

Quantitative Information – Derivative Financial Instruments

The effects of the Company’s derivative instruments on its consolidated financial statements were as follows:

(i) The fair values of the 2013 Interest Rate Swap at June 30, 2015 and December 31, 2014 were measured based on the implied forward rates from the U.S. Dollar three-month LIBOR yield curve at June 30, 2015 and December 31, 2014, respectively.

(ii) The fair values of the FX Contracts at June 30, 2015 and December 31, 2014 were measured based on observable market transactions of spot and forward rates at June 30, 2015 and December 31, 2014, respectively.

(b) Effects of Derivative Financial Instruments on the Consolidated Statements of Income and Comprehensive Income for the three and six months ended June 30, 2015 and 2014:

Amount of Gain (Loss) Recognized in Other Comprehensive Income

Three Months Ended June 30,

Six Months Ended June 30,

2015

2014

2015

2014

Derivatives designated as hedging instruments:

2013 Interest Rate Swap, net of tax (a)

$

(0.1

)

$

(1.9

)

$

(2.0

)

$

(2.9

)

(a)

Net of tax benefit of nil and $1.2 million for the three months ended June 30, 2015 and 2014, respectively, and$1.2 million and $1.8 million for the six month ended June 30, 2015 and 2014, respectively.

14

REVLON CONSUMER PRODUCTS CORPORATION AND SUBSIDIARIES

NOTES TO UNAUDITED CONSOLIDATED FINANCIAL STATEMENTS

(except where otherwise noted, all tabular amounts in millions)

Income Statement Classification

Amount of Gain (Loss) Recognized in Net Income

Three Months Ended June 30,

Six Months Ended June 30,

2015

2014

2015

2014

Derivatives designated as hedging instruments:

2013 Interest Rate Swap

Interest Expense

$

(0.5

)

$

—

$

(0.5

)

$

—

Derivatives not designated as hedging instruments:

FX Contracts

Foreign currency gain (loss), net

$

0.4

$

(1.2

)

$

0.9

$

(1.3

)

11. PENSION AND POST-RETIREMENT BENEFITS

The components of net periodic benefit (income) costs for the Company’s pension and the other post-retirement benefit plans for the second quarter of 2015 and 2014 are as follows:

Pension Plans

Other Post-RetirementBenefit Plans

Three Months Ended June 30,

2015

2014

2015

2014

Net periodic benefit (income) costs:

Service cost

$

0.2

$

0.2

$

—

$

—

Interest cost

7.1

7.6

0.1

0.1

Expected return on plan assets

(10.2

)

(10.3

)

—

—

Amortization of actuarial loss

2.1

1.0

0.1

0.1

(0.8

)

(1.5

)

0.2

0.2

Portion allocated to Revlon Holdings

(0.1

)

—

—

—

$

(0.9

)

$

(1.5

)

$

0.2

$

0.2

The components of net periodic benefit (income) costs for the Company’s pension and the other post-retirement benefit plans for the first six months of 2015 and 2014 are as follows:

Pension Plans

Other Post-RetirementBenefit Plans

Six Months Ended June 30,

2015

2014

2015

2014

Net periodic benefit (income) costs:

Service cost

$

0.4

$

0.4

$

—

$

—

Interest cost

14.3

15.1

0.2

0.3

Expected return on plan assets

(20.3

)

(20.7

)

—

—

Amortization of actuarial loss

4.1

2.2

0.1

0.1

(1.5

)

(3.0

)

0.3

0.4

Portion allocated to Revlon Holdings

(0.1

)

—

—

—

$

(1.6

)

$

(3.0

)

$

0.3

$

0.4

In the three and six months ended June 30, 2015, the Company recognized net periodic benefit income of $0.7 million and $1.3 million, respectively, compared to $1.3 million and $2.6 million in the three and six months ended June 30, 2014, respectively, primarily due to higher amortization of actuarial losses.

The Company expects that it will have net periodic benefit income of approximately $2.4 million for its pension and other post-retirement benefit plans for all of 2015, compared with net periodic benefit income of $5.4 million in 2014.

During the second quarter of 2015, $2.4 million and $0.3 million were contributed to the Company’s pension plans and other post-retirement benefit plans, respectively. During the first six months of 2015, $4.8 million and $0.4 million were contributed to the Company’s pension plans and other post-retirement benefit plans, respectively. The Company currently expects to contribute approximately $20 million in the aggregate to its pension and other post-retirement benefit plans in 2015.

Relevant aspects of the qualified defined benefit pension plans, nonqualified pension plans and other post-retirement benefit plans sponsored by Products Corporation are disclosed in Note 14, "Savings Plan, Pension and Post-Retirement Benefits," to the Consolidated Financial Statements in the Company's 2014 Form 10-K.

12. INCOME TAXES

The provision for income taxes represents federal, foreign, state and local income taxes. The effective tax rate differs from the applicable federal statutory rate due to the effect of state and local income taxes, tax rates and income in foreign jurisdictions, utilization of tax loss carryforwards, foreign earnings taxable in the U.S., non-deductible expenses and other items. The Company’s tax provision changes quarterly based on various factors including, but not limited to, the geographical mix of earnings, enacted tax legislation, foreign, state and local income taxes, tax audit settlements and the interaction of various global tax strategies. In addition, changes in judgment from the evaluation of new information resulting in the recognition, derecognition and/or re-measurement of a tax position taken in a prior period are recognized in the quarter in which any such change occurs.

For the second quarter of 2015 and 2014, the Company recorded a provision for income taxes of $21.4 million and $19.3 million, respectively. The $2.1 million increase in the provision for income taxes was primarily attributable to higher pretax income in the second quarter of 2015.

For the first six months of 2015 and 2014, the Company recorded a provision for income taxes of $31.0 million and $27.0 million, respectively. The $4.0 million increase in the provision for income taxes was primarily attributable to certain discrete items that favorably affected the provision for income taxes in the first six months of 2014, which did not recur in the first six months of 2015, partially offset by the timing of the recognition of the provision for income taxes based on pretax income for the first six months of 2015 as compared to the first six months of 2014.

The Company's effective tax rate for the three months ended June 30, 2015 was higher than the federal statutory rate of 35% due principally to foreign dividends and earnings taxable in the U.S. and state and local taxes.

The Company's effective tax rate for the six months ended June 30, 2015 was higher than the federal statutory rate of 35% due principally to foreign and U.S. tax effects attributable to operations outside the U.S., foreign dividends and earnings taxable in the U.S. and state and local taxes.

The Company remains subject to examination of its income tax returns in various jurisdictions including, without limitation, Australia and Spain, for tax years ended December 31, 2010 through December 31, 2013, the U.S. (federal) and South Africa for tax years ended December 31, 2011 through December 31, 2013, and Canada for tax years ended December 31, 2011 through December 31, 2014.

16

REVLON CONSUMER PRODUCTS CORPORATION AND SUBSIDIARIES

NOTES TO UNAUDITED CONSOLIDATED FINANCIAL STATEMENTS

(except where otherwise noted, all tabular amounts in millions)

13. ACCUMULATED OTHER COMPREHENSIVE LOSS

The components of accumulated other comprehensive loss as of June 30, 2015 are as follows:

Amounts represent the change in accumulated other comprehensive loss as a result of the amortization of actuarial losses (gains) arising during each year related to the Company’s pension and other post-retirement plans. See Note 11, “Pension and Post-retirement Benefits,” for further discussion of the Company’s pension and other post-retirement plans.

(b)

For the six months ended June 30, 2015, the 2013 Interest Rate Swap was deemed effective and therefore, the changes in fair value related to the 2013 Interest Rate Swap are recorded in other comprehensive loss. See Note 10, "Financial Instruments," for further discussion of the 2013 Interest Rate Swap.

As shown above, comprehensive loss includes changes in the fair value of the 2013 Interest Rate Swap, which qualify for hedge accounting. A rollforward of the amounts reclassified out of accumulated other comprehensive loss into earnings as of June 30, 2015 are as follows:

2013

Interest Rate Swap

Beginning accumulated losses at March 31, 2015

(4.1

)

Reclassifications into earnings (net of $0.2 million tax benefit)(a)

0.3

Change in fair value (net of $0.2 million tax benefit)

(0.4

)

Ending accumulated losses at June 30, 2015

$

(4.2

)

(a)

Reclassified to interest expense.

2013

Interest Rate Swap

Beginning accumulated losses at December 31, 2014

(2.2

)

Reclassifications into earnings (net of $0.2 million tax benefit)(a)

0.3

Change in fair value (net of $1.4 million tax benefit)

(2.3

)

Ending accumulated losses at June 30, 2015

$

(4.2

)

(a)

Reclassified to interest expense.

There were no amounts reclassified into earnings during 2014.

17

REVLON CONSUMER PRODUCTS CORPORATION AND SUBSIDIARIES

NOTES TO UNAUDITED CONSOLIDATED FINANCIAL STATEMENTS

(except where otherwise noted, all tabular amounts in millions)

14. SEGMENT DATA AND RELATED INFORMATION

Operating segments include components of an enterprise about which separate financial information is available that is evaluated regularly by the chief operating decision maker (the “Chief Executive Officer”) in deciding how to allocate resources and in assessing the Company's performance. As a result of the similarities in the procurement, marketing and distribution processes for all of the Company’s products, much of the information provided in the consolidated financial statements is similar to, or the same as, that reviewed on a regular basis by the Company's management.

At June 30, 2015, the Company’s operations are organized into the following operating segments:

•

Consumer - The Consumer segment is comprised of the Company's consumer brands, which primarily include Revlon, Almay, SinfulColors and Pure Ice in cosmetics; Revlon ColorSilk in women’s hair color; Revlon in beauty tools; and Mitchum in anti-perspirant deodorants. The Company’s principal customers for its consumer products include the mass retail channel, consisting of large mass volume retailers and chain drug and food stores in the U.S. and internationally, as well as certain department stores and other specialty stores, such as perfumeries, outside the U.S. The Consumer segment also includes a skincare line and hair color line sold in the mass retail channel, primarily in Spain, which were acquired as part of the Colomer Acquisition.

•

Professional - The Professional segment is comprised primarily of the brands which the Company acquired in the Colomer Acquisition, which include Revlon Professional in hair color and hair care; CND-branded productsin nail polishes and nail enhancements; and American Crew in men’s grooming products, all of which are sold worldwide in the professional salon channel. The Company’s principal customers for its professional products include hair and nail salons and distributors in the U.S. and internationally. The Professional segment also includes a multi-cultural line consisting of Creme of Nature hair care products sold in the mass retail channel and in professional salons, primarily in the U.S.

•

Other - The Other segment primarily includes the operating results of the CBB business and related purchase accounting for the Company's April 2015 CBB Acquisition. The results included within the Other segment are not material to the Company's consolidated results of operations.

The Company's management evaluates segment profit, which is defined as income from continuing operations before interest, taxes, depreciation, amortization, stock-based compensation expense, gains/losses on foreign currency fluctuations, gains/losses on the early extinguishment of debt and miscellaneous expenses, for each of the Company's reportable segments. Segment profit also excludes unallocated corporate expenses and the impact of certain items that are not directly attributable to the reportable segments' underlying operating performance, which includes the impacts of: (i) restructuring and related charges; (ii) acquisition and integration costs; (iii) costs of sales resulting from a fair value adjustment in the second quarter of 2015 to inventory acquired in the CBB Acquisition; and (iv) costs of sales resulting from a fair value adjustment in the first quarter of 2014 to inventory acquired in the Colomer Acquisition. Such items are shown below in the table reconciling segment profit to consolidated income from continuing operations before income taxes. Unallocated corporate expenses primarily include general and administrative expenses related to the corporate organization. These expenses are recorded in unallocated corporate expenses as these items are centrally directed and controlled and are not included in internal measures of segment operating performance. During the second quarter of 2015, the Company removed pension-related costs for its U.S. qualified defined benefit pension plans from the measurement of its operating segment results. As a result, $2.1 million and $4.1 million in pension-related costs were reclassified from the measurement of Consumer segment profit and included as a component of unallocated corporate expenses for the three and six months ended June 30, 2014, respectively. The Company does not have any material inter-segment sales.

The accounting policies for each of the reportable segments are the same as those described in Note 1, “Description of Business and Summary of Significant Accounting Policies” in the Company's 2014 Form 10-K. The Company's assets and liabilities are managed centrally and are reported internally in the same manner as the consolidated financial statements; thus, no additional information regarding assets and liabilities of the Company’s operating segments is produced for the Company's management or included in these financial statements.

18

REVLON CONSUMER PRODUCTS CORPORATION AND SUBSIDIARIES

NOTES TO UNAUDITED CONSOLIDATED FINANCIAL STATEMENTS

(except where otherwise noted, all tabular amounts in millions)

The following table is a comparative summary of the Company’s net sales and segment profit by operating segment for the three and six months ended June 30, 2015 and 2014. In the table below, certain prior period amounts have been reclassified to conform to the presentation for 2015.

Three Months Ended June 30,

Six Months Ended June 30,

2015

2014

2015

2014

Segment Net Sales:

Consumer

$

354.7

$

367.3

$

679.0

$

706.8

Professional

123.4

130.6

237.6

260.9

Other

$

4.3

$

—

$

4.3

$

—

Total

$

482.4

$

497.9

$

920.9

$

967.7

Segment Profit:

Consumer (a)

$

83.8

$

80.3

$

146.0

$

149.8

Professional

24.3

31.4

53.5

63.3

Other

$

(0.5

)

$

—

$

(0.5

)

$

—

Total

$

107.6

$

111.7

$

199.0

$

213.1

Reconciliation:

Segment Profit

$

107.6

$

111.7

$

199.0

$

213.1

Less:

Unallocated corporate expenses (a)

15.8

15.7

30.5

27.1

Depreciation and amortization

25.2

26.0

50.8

50.8

Non-cash stock compensation expense

1.2

0.3

2.8

0.5

Non-recurring items:

Restructuring and related charges

(3.0

)

4.1

(2.3

)

17.7

Acquisition and integration costs

4.7

0.7

5.9

4.5

Inventory purchase accounting adjustment, cost of sales

0.6

—

0.6

2.6

Operating Income

63.1

64.9

110.7

109.9

Less:

Interest Expense

20.5

21.0

40.5

43.3

Amortization of debt issuance costs

1.4

1.4

2.8

2.8

Loss on early extinguishment of debt

—

0.1

—

2.0

Foreign currency losses (gains), net

(7.9

)

7.2

8.0

8.6

Miscellaneous, net

0.2

—

0.2

0.1

Income from continuing operations before income taxes

$

48.9

$

35.2

$

59.2

$

53.1

(a)

During the second quarter of 2015, the Company removed pension-related costs for itsU.S. qualified defined benefit pension plans from the measurement of its operating segment results. As a result, $2.1 million and $4.1 million in pension-related costs were reclassified from the measurement of Consumer segment profit and included as a component of unallocated corporate expenses for the three and six months ended June 30, 2014, respectively.

As of June 30, 2015, the Company had operations established in 24 countries outside of the U.S. and its products are sold throughout the world. Generally, net sales by geographic area are presented by attributing revenues from external customers on the basis of where the products are sold.